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Re: MAGI and Lifetime Learning Credit

Worksheet 3-1.MAGI for the Lifetime Learning Credit 1. Enter your adjusted gross income (Form 1040, line 38) 1. 2. Enter your foreign earned income exclusion and/or housing exclusion (Form 2555, line 45, or Form 2555-EZ, line 18) 2. 3. Enter your foreign housing deduction (Form 2555, line 50) 3. 4. ...
by kaneohe
Sun Jul 06, 2014 9:18 pm
 
Forum: Personal Finance (Not Investing)
Topic: MAGI and Lifetime Learning Credit
Replies: 7
Views: 490

Re: IRA to Roth Conversion Deadline

You can do the Roth conversion whenever you want. Depending on what you are doing, sometimes it is better to do it soon after you make the TIRA contribution.
by kaneohe
Thu Jul 03, 2014 1:03 pm
 
Forum: Investing - Help with Personal Investments
Topic: IRA to Roth Conversion Deadline
Replies: 5
Views: 369

Re: Found an old deposit receipt for my late wife . . .

1. Don't custodians send out Form 5498 every year for IRA accounts? That happens only if during the year assets were contributed, rolled over, converted, or distributed. If the IRA is just plugging away with reinvested dividends there is no Form 5498. Specific Instructions for Form 5498 File Form 5...
by kaneohe
Tue Jun 24, 2014 10:52 pm
 
Forum: Personal Finance (Not Investing)
Topic: Found an old deposit receipt for my late wife . . .
Replies: 27
Views: 3812

Re: Tax Bracket Management at 15%/25% Boundary

ssc.........you are correct. I misread original amt as exclusive of QDI/LTCG when it was inclusive. Thanks for clarifying.
by kaneohe
Wed Jun 18, 2014 2:25 pm
 
Forum: Personal Finance (Not Investing)
Topic: Tax Bracket Management at 15%/25% Boundary
Replies: 33
Views: 3259

Re: Tax Bracket Management at 15%/25% Boundary

2. Make sure you understand how qualified dividends and long term capital gains are taxed. Example: if you are $4000 above the top of the 15% bracket, and have $8,000 in QDI and LTCG, then $4000 of it is taxed at 0%, and the other $4000 is taxed at 15%. And (if the rest of your 1040 is plain vanill...
by kaneohe
Wed Jun 18, 2014 12:36 pm
 
Forum: Personal Finance (Not Investing)
Topic: Tax Bracket Management at 15%/25% Boundary
Replies: 33
Views: 3259

Re: How much do you contribute to your HSA?

[quote="Bill M" I'm somewhat AR about records. I keep all the EOB forms from UnitedHealthCare and the Dental plans (downloaded as pdf files), and also scan the insurance premium statements and other bills for deductible medical expenses. Then there is a Excel spreadsheet that ties them all...
by kaneohe
Wed Jun 18, 2014 8:31 am
 
Forum: Personal Finance (Not Investing)
Topic: How much do you contribute to your HSA?
Replies: 17
Views: 937

Re: New job: Trying to decide on tax exemptions and withhold

Here is one approach: calculate by hand your estimated income from your 2 jobs. Use a tax calculator like Taxcaster (google for it) and input your earned income and any other income you have as well as your deductions (or use standard deduction) to calculate your estimated tax for the whole year. Su...
by kaneohe
Tue Jun 17, 2014 9:01 pm
 
Forum: Personal Finance (Not Investing)
Topic: New job: Trying to decide on tax exemptions and withholding
Replies: 3
Views: 346

Re: Remodel questions

The sales tax would be deducted instead of the state/city income tax (not property tax). Under certain conditions you can add the sales tax for materials for a major remodel to the general sales tax from the table based on income. I am not 100% sure CA falls in that category......either you pay the ...
by kaneohe
Fri Jun 13, 2014 3:29 am
 
Forum: Personal Consumer Issues
Topic: Remodel questions
Replies: 1
Views: 351

Re: HSA vs. Taxable Account

perhaps you can make a "post-tax" contribution elsewhere and deduct it on line 25 of your 1040.
by kaneohe
Tue Jun 10, 2014 7:30 pm
 
Forum: Investing - Help with Personal Investments
Topic: HSA vs. Taxable Account
Replies: 4
Views: 357

Re: Wiki: Tax Effects of Maximizing Roth IRA Contributions

The math Roth: 6k @ 7% = 23.2k Traditional 6k*7%*.75 = 17.34 2k*6.25%= 2000+(6724-2000)*.85 = 6015 23.34k As expected given the way the tax code works the TIRA wins. You can tweak the 6.25% number to match you estimate for the yearly tax drag but it is a pretty reasonable one. As expected contribut...
by kaneohe
Mon Jun 09, 2014 11:37 pm
 
Forum: Investing - Theory, News & General
Topic: Wiki: Tax Effects of Maximizing Roth IRA Contributions
Replies: 26
Views: 1811

Re: Estate Efficiency and Parent's RMDs

You should at least be aware of this effect on Medicare premiums as income goes higher. You may decide it is neglible or not.........
http://www.ssa.gov/pubs/EN-05-10536.pdf
by kaneohe
Sun Jun 08, 2014 8:44 pm
 
Forum: Investing - Help with Personal Investments
Topic: Estate Efficiency and Parent's RMDs
Replies: 21
Views: 1495

Re: Bank Account for Estimated Tax Payments

Does he have a local Schwab branch or something equivalent that he could link to an online bank money market account like Ally. The Ally account , I believes has no fees for normal type operations, no min balances, etc. and has limited checkwriting. Schwab will do the link and if he is willing/able ...
by kaneohe
Fri Jun 06, 2014 1:01 am
 
Forum: Personal Finance (Not Investing)
Topic: Bank Account for Estimated Tax Payments
Replies: 4
Views: 498

Re: Living trust vs will

bsteiner wrote:
Revocable trusts are appropriate in some cases, and in some states. They're common in California for reasons specific to California.
.


What are those reasons specific to CA?
by kaneohe
Wed Jun 04, 2014 10:21 am
 
Forum: Personal Finance (Not Investing)
Topic: Living trust vs will
Replies: 26
Views: 2493

Re: GE Capital Retail Bank 5-Year 2.3% CD

any existing GE Capital Retail Bank CDs held and any new Synchrony Bank CD purchases will be aggregated for FDIC insurance calculations. That's what Schwab tells me anyway. That seems slightly strange, since someone with CDs in both places could now wind up over the insurance limit. If that's possi...
by kaneohe
Tue Jun 03, 2014 1:04 am
 
Forum: Investing - Theory, News & General
Topic: GE Capital Retail Bank 5-Year 2.3% CD
Replies: 75
Views: 7730

Re: [Cost basis method for a mutual fund?]

Look at your tax situation. If you are in 15% marginal rate, then long-term capital gains are taxed at 0% and you want to show a gain. Why??? For a given outcome (sales price), wouldn't you want to select the tax reporting that gave you the lowest result (even a loss)..........regardless of tax bra...
by kaneohe
Thu May 29, 2014 12:25 pm
 
Forum: Investing - Theory, News & General
Topic: [Cost basis method for a mutual fund?]
Replies: 9
Views: 642

Re: Roth IRA conversion: 5 year rule question

Alan, thanks for the followup. I think I understood from your first post that the distribution and conversion are declared on the earlier year tax return and that someone might be tempted to start the 5 yr conversion clock from the earlier year when it should be started from the later year. What I w...
by kaneohe
Sat May 24, 2014 4:27 am
 
Forum: Investing - Help with Personal Investments
Topic: Roth IRA conversion: 5 year rule question
Replies: 8
Views: 942

Re: Roth IRA conversion: 5 year rule question

Alan, interesting example. Perhaps a case when knowing less might have helped....at least for the 5 yr clock. I would never have thought that the conversion would have been declared in the earlier year since it was finalized in the later year. Hopefully, though, I would have been disturbed eventuall...
by kaneohe
Fri May 23, 2014 1:46 pm
 
Forum: Investing - Help with Personal Investments
Topic: Roth IRA conversion: 5 year rule question
Replies: 8
Views: 942

Re: Cost basis of stock gifts using the lifetime exclusion

Iorek wrote:Wouldn't person A rather pay LTCG tax than gift tax, and gift the proceeds?


Perhaps they would pay up to 23.8% on that but maybe B is in a lower bracket? Or maybe, as previously suggested, B might prefer to inherit it.
by kaneohe
Fri May 23, 2014 12:23 pm
 
Forum: Investing - Theory, News & General
Topic: Cost basis of stock gifts using the lifetime exclusion
Replies: 11
Views: 613

Re: Roth IRA conversion: 5 year rule question

and for those who prefer nutshells, there is this wonderful table from the fairmark.com site by kawill (and vetted by Alan S.): (no thinking involved...the ordering rules of withdrawals considered to be contributions first, then conversions (oldest first), and finally earnings are implicit in the wa...
by kaneohe
Fri May 23, 2014 12:13 pm
 
Forum: Investing - Help with Personal Investments
Topic: Roth IRA conversion: 5 year rule question
Replies: 8
Views: 942

Re: AMT Planning Strategies

Both the H&R Block tax calculator and Taxcaster do AMT. They are not full blown tax software so you may need to improvise in inputting data.
You can find them w/ google.
by kaneohe
Wed May 21, 2014 9:20 pm
 
Forum: Personal Finance (Not Investing)
Topic: AMT Planning Strategies
Replies: 13
Views: 1338

Re: Traditional IRA to Roth Conversion Question

One important fact is missing which probably accounts for the range of answers you are getting. Do you have any other TIRAs w/ deductible contributions. If you do not and the earnings are "not significant", then you probably want to do the conversion as soon as possible to minimize the tax...
by kaneohe
Wed May 21, 2014 2:05 pm
 
Forum: Investing - Help with Personal Investments
Topic: Traditional IRA to Roth Conversion Question
Replies: 20
Views: 1356

Re: quick question about IRA->Roth transfer

If you fill out Form 8606 Pt I & II, the answer will be evident (and it isn't what you want).
by kaneohe
Tue May 20, 2014 8:28 pm
 
Forum: Personal Finance (Not Investing)
Topic: quick question about IRA->Roth transfer
Replies: 6
Views: 422

Re: Disclaiming a Roth IRA inheritance

Why disclaim. Why not just make the sons the primary beneficiaries. Are you saying after the wife inherits from her mother, make the wife's sons her primary beneficiaries? If sons inherit mother's inherited IRA, RMDs are taken out based on mother's age which will be significantly higher than if the...
by kaneohe
Thu May 15, 2014 5:22 pm
 
Forum: Investing - Theory, News & General
Topic: Disclaiming a Roth IRA inheritance
Replies: 26
Views: 2165

Re: Multiple contribution withdrawals from Roth

As others have tried to explain to you.......there are 2 types of withdrawals: 1) One is as you are thinking......contributions FIFO first, then conversion FIFO, then earnings. In this case you do not have to take earnings until last. 2) Current year contributions....which is basically undoing the c...
by kaneohe
Tue May 13, 2014 10:10 pm
 
Forum: Personal Finance (Not Investing)
Topic: Multiple contribution withdrawals from Roth
Replies: 13
Views: 676

Re: Inheriting Series EE Savings Bonds question

http://www.treasurydirect.gov/forms/sav5336.pdf

The last entry in Pt C is to distribute securities. Pt F provides the new registration info.
by kaneohe
Mon May 12, 2014 1:30 pm
 
Forum: Investing - Help with Personal Investments
Topic: Inheriting Series EE Savings Bonds question
Replies: 5
Views: 464

Re: How exactly does Vanguard's RMD service work? Rebalancin

I have wondered if you can have withdrawal of RMD as a "fail-safe" way just in case you miss your planned distribution. So if you forget, or get sick,or die, they would distribute any amount left of the required amount but none if you have already done it before, eg., December 28th. I onl...
by kaneohe
Sat May 10, 2014 11:49 am
 
Forum: Investing - Help with Personal Investments
Topic: How exactly does Vanguard's RMD service work? Rebalancing?
Replies: 44
Views: 3554

Re: Ally checking account

ss= 6. How many checks /mo. cycle for MMA. For the small sample, all answered 6 checks.
Ally Bank, GE Capital Retail BAank, TIAA-direct, Capital One, Union Bank, PenFed CU. YMMV
A couple of these could replace a checking acct for most folks.
by kaneohe
Mon May 05, 2014 1:00 pm
 
Forum: Personal Consumer Issues
Topic: Ally checking account
Replies: 20
Views: 1695

Re: Ally checking account

Thank you all for your replies. We have had a MM at Ally for a couple of years but a MM account is pretty low maintenance. I need to find out if auto bill pay can be set up with a MM account or if checking is required for that. MM has a limit to monthly transactions. I think it is 6. Yes, six withd...
by kaneohe
Sun May 04, 2014 1:53 pm
 
Forum: Personal Consumer Issues
Topic: Ally checking account
Replies: 20
Views: 1695

Re: Comparison of RMD with 4% withdrawal

https://www.irahelp.com/printable/2014-uniform-lifetime-table

Check out this table . You'll see as you observed that the 4% matches in the early 70's but the RMD % increases as you age.
At 80, it's about 5%; at 90, about 9%, at 100, about 16%.
by kaneohe
Wed Apr 30, 2014 12:57 pm
 
Forum: Investing - Help with Personal Investments
Topic: Comparison of RMD with 4% withdrawal
Replies: 4
Views: 358

Re: $400 reward to open Chase accounts

You might also want to check min. balance requirements. In my area it was $300 for savings and $1500 for checking. The exit path other than the 6 mos. open time
appears to be open to you but it appears that they may keep records of your previous history just in case you think of repeating this.
by kaneohe
Mon Apr 28, 2014 1:26 am
 
Forum: Personal Finance (Not Investing)
Topic: $400 reward to open Chase accounts
Replies: 15
Views: 4104

Re: Money market vs savings

A combination of the two can be useful if the min. balance on the m.mkt is not outrageous and the differential yield is not too large. You can keep most of the funds in the savings and then then just move more funds (above the min balance) into the m.mkt if you want to write a check to move funds or...
by kaneohe
Thu Apr 24, 2014 8:38 pm
 
Forum: Personal Finance (Not Investing)
Topic: Money market vs savings
Replies: 10
Views: 1573

Re: Can you put after tax RMD withdrawals into ROTH?

Be sure to take out all of your RMD first before you withdraw the additional amount to convert. If you do them in the opposite order, you could be creating trouble.
by kaneohe
Fri Apr 18, 2014 3:53 pm
 
Forum: Investing - Help with Personal Investments
Topic: Can you put after tax RMD withdrawals into ROTH?
Replies: 25
Views: 1790

Re: Question on borrowing from IRA

Withholding from IRA distributions is not mandatory but you may have to sign something agreeing to 0 withholding with that institution.
by kaneohe
Fri Apr 18, 2014 3:45 pm
 
Forum: Investing - Help with Personal Investments
Topic: Question on borrowing from IRA
Replies: 12
Views: 767

Re: Little to no income for 2 years- take IRA RMDs up to 37k

Perhaps you can model it with an Excel spreadsheet in much more detail than a simple example below using your own crystal ball assumptions. Some simple extreme cases (pls check the math): 1) take everything out at 15% now. If you started with 10K in IRA, pay 1.5K in taxes and have 8.5K in taxable ac...
by kaneohe
Thu Apr 17, 2014 12:06 pm
 
Forum: Personal Finance (Not Investing)
Topic: Little to no income for 2 years- take IRA RMDs up to 37k?
Replies: 14
Views: 1239

Re: Little to no income for 2 years- take IRA RMDs up to 37k

If you are going to pay the taxes to withdraw excess funds (over RMD), would it make sense to do a Roth conversion on those excess funds (can't convert RMDs)? That way the gains will be tax-free instead of possibly subject to tax in a taxable account. Kaneohe, you must have missed the fact that thi...
by kaneohe
Wed Apr 16, 2014 11:06 pm
 
Forum: Personal Finance (Not Investing)
Topic: Little to no income for 2 years- take IRA RMDs up to 37k?
Replies: 14
Views: 1239

Re: Little to no income for 2 years- take IRA RMDs up to 37k

If you are going to pay the taxes to withdraw excess funds (over RMD), would it make sense to do a Roth conversion on those excess funds (can't convert RMDs)?
That way the gains will be tax-free instead of possibly subject to tax in a taxable account.
by kaneohe
Wed Apr 16, 2014 9:50 pm
 
Forum: Personal Finance (Not Investing)
Topic: Little to no income for 2 years- take IRA RMDs up to 37k?
Replies: 14
Views: 1239

Re: Should I be using standard or itemized deduction?

What's annoying about Standard vs Itemized is that if you are 65 or older (or blind), they just increase your Standard deduction by some amount. They do NOTHING to benefit older folks who are still itemizing deductions due to large property tax and/or state income tax payments. Or have I missed som...
by kaneohe
Tue Apr 15, 2014 7:46 pm
 
Forum: Personal Finance (Not Investing)
Topic: Should I be using standard or itemized deduction?
Replies: 10
Views: 896

Re: Estimated taxes on capital gains later offset by losses

http://www.irs.gov/pub/irs-pdf/f1040es.pdf

how about just filling out the wksht on p.7 and pretending you had perfect foresight into what was going to happen?
Then you end up w/ 0 payments due.
by kaneohe
Tue Apr 15, 2014 10:20 am
 
Forum: Investing - Help with Personal Investments
Topic: Estimated taxes on capital gains later offset by losses
Replies: 7
Views: 513

Re: VA Question

don't think you can do that unless VA is really old : https://www.edwardjones.com/en_US/products/investments/annuities/annuities_tax/index.html Withdrawals – Withdrawals of earnings from a nonqualified annuity are fully taxable at ordinary income tax rates. Unless the annuity was purchased before Au...
by kaneohe
Tue Apr 15, 2014 8:39 am
 
Forum: Investing - Help with Personal Investments
Topic: VA Question
Replies: 4
Views: 507

Re: HSA cost benefit analysis

. Also, once you reach 65, you can withdraw funds tax free for non medical purposes. . Not really.........non-medical reimbursements are taxed but not penalized (additional tax). From Pub 969: Distributions From an HSA ......................................................................... You ca...
by kaneohe
Sun Apr 13, 2014 8:55 am
 
Forum: Personal Finance (Not Investing)
Topic: HSA cost benefit analysis
Replies: 23
Views: 2090

Re: Questions on Cashing Out ESPP

As previously suggested, you should model this w/ tax software/calculator. Based on this http://fairmark.com/general-taxation/reference-room/2014-tax-rate-schedules/ it may end up that all you will see is that the CGs get taxed at 15% regardless of the amount you sell (assuming 50K max gain) and you...
by kaneohe
Wed Apr 09, 2014 11:52 pm
 
Forum: Investing - Help with Personal Investments
Topic: Questions on Cashing Out ESPP
Replies: 2
Views: 273

Re: Reel Lawn Mowers

this? http://www.mowersdirect.com/stories/55-How-to-Pick-the-Perfect-Reel-Lawn-Mower.html Only thing I've ever owned. Blades get dull after a couple yrs and need to be sharpened which cost perhaps half the cost of the mower. Never heard of using the abrasive while mowing..............will have to in...
by kaneohe
Tue Apr 08, 2014 8:53 pm
 
Forum: Personal Consumer Issues
Topic: Reel Lawn Mowers
Replies: 19
Views: 1933

Re: RMD question

ssc.............I thought I had seen Alan S. say you could break up the first RMD into 2 yrs if desired so that the choices ranged from RMD1 in yr 1 and RMD 2 in yr 2 to RMD1/2 in yr 2
or anything in between.
by kaneohe
Sun Apr 06, 2014 12:39 pm
 
Forum: Personal Finance (Not Investing)
Topic: RMD question
Replies: 8
Views: 531

Re: Need to reduce AGI by $3000. Suggestions?

^ If using QCD, my understanding is that FIRST withdrawal annually from an IRA is considered the RMD, so that the QCD would have to be the FIRST withdrawal for it to be considered as part of the RMD. As BL notes below, it doesn't have to be the first withdrawal but it should be taken before the RMD...
by kaneohe
Sun Mar 30, 2014 5:30 pm
 
Forum: Personal Finance (Not Investing)
Topic: Need to reduce AGI by $3000. Suggestions?
Replies: 14
Views: 1537

Re: Need to reduce AGI by $3000. Suggestions?

^ If using QCD, my understanding is that FIRST withdrawal annually from an IRA is considered the RMD, so that the QCD would have to be the FIRST withdrawal for it to be considered as part of the RMD. As BL notes below, it doesn't have to be the first withdrawal but it should be taken before the RMD...
by kaneohe
Sun Mar 30, 2014 5:17 pm
 
Forum: Personal Finance (Not Investing)
Topic: Need to reduce AGI by $3000. Suggestions?
Replies: 14
Views: 1537

Re: IRS Pub 550: Basis of Covered vs. Non-Covered Shares

p.46 of pub 550 has separate paragraphs for Election of Avg Basis of Covered Securities and Election of Avg Basis of Non-covered Securities which suggests that they are calculated
separately .
by kaneohe
Sun Mar 30, 2014 12:40 am
 
Forum: Personal Finance (Not Investing)
Topic: IRS Pub 550: Basis of Covered vs. Non-Covered Shares
Replies: 5
Views: 500

Re: Roth recharacterization- Form 8606T Explanation

perhaps also the date and the institutions involved so that even you could reconstruct the event years from now when you might be asked to prove what happened.
by kaneohe
Sat Mar 29, 2014 8:00 pm
 
Forum: Personal Finance (Not Investing)
Topic: Roth recharacterization- Form 8606T Explanation
Replies: 8
Views: 475

Re: IRS letter claiming return is late - anyone experience t

I always owe and I usually send in paper returns with a check. My CU tells me (via email) when they post the check to my account and provides a picture of the front and back of the check with the recipients endorsement. Easy to print and attach to the return for a record. Have never saw a need to s...
by kaneohe
Fri Mar 28, 2014 8:27 pm
 
Forum: Personal Finance (Not Investing)
Topic: IRS letter claiming return is late - anyone experience this?
Replies: 34
Views: 4601
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